A few sobering facts to consider on this sunny Tuesday:
Only 48 percent of actively managed funds that were around at the beginning of 2004 are still around as of December 31, 2013. It’s amazing that over half of the mutual funds in existence a decade ago have gone out of business.
During that same time period, only 19 percent of the funds that survived the decade beat their benchmark.
Mutual funds with the highest expenses underperformed their benchmarks by the most. In this case, you are definitely not getting what you pay for!
Dan Solin, Director of Investor Advocacy for The Bam Alliance, shares these facts and some additional thoughts in his blog on Huffington Post. See the full article here.
At Cornerstone Wealth Advisors, we primarily use Dimensional Fund Advisors (DFA) to construct our clients’ portfolios. DFA funds are ultra-low cost, institutional, no-load funds and focus on using academic research (not individual stock picking) to manage the funds. To learn more, contact us to set up a meeting.